Advisory Opinion No. 2000-73

Re: Victor V. Calabretta

QUESTION PRESENTED

The petitioner, a Jamestown Planning Commission member, a municipal appointed position, requests an advisory opinion as to whether his participation on a zoning ordinance revision regarding offsite marina parking would constitute a conflict of interest given his company’s business relationship with a marina that might be affected by the revision.

RESPONSE

It is the opinion of the Rhode Island Ethics Commission that the petitioner, a Jamestown Planning Commission member, a municipal appointed position, may not participate in a zoning ordinance revision regarding offsite parking given that his business associate may be financially impacted by the ordinance. Since the petitioner is a principal in an engineering firm that continues to do consulting work for Conanicut Marine Services (“Conanicut”), he is a business associate of Conanicut and is required to recuse in matters where it is reasonably foreseeable that his business associate will be impacted. In this matter, since the petitioner’s business associate is currently seeking additional offsite parking that would be prohibited by the ordinance revision if its special permit request is denied, it is reasonably foreseeable that Conanicut could be financially impacted by an ordinance limiting offsite parking. Therefore, the petitioner must recuse in compliance with Section 6 of the Code of Ethics by recusing from discussion regarding the ordinance and completing a statement of conflict of interest and filing it with the Planning Commission and the Ethics Commission.

Under the Code of Ethics, the petitioner may not participate in any matter in which he has an interest, financial or otherwise, which is in substantial conflict with the proper discharge of his duties in the public interest. A substantial conflict is defined as a “direct monetary gain or a direct monetary loss” that accrues, by virtue of the public official’s activity, to that individual, a family member, a business associate, an employer, or any business which the public official represents. See R.I. Gen. Laws §§ 36-14-5(a), 7(a). Additionally, the Code provides that the petitioner has reason to believe or expect a conflict of interest exists if it is "reasonably foreseeable" that he, a family member, employer, or business associate will be financially impacted. To be "reasonably foreseeable" the probability must be greater than "conceivable," but the impact need not be certain to occur. See Commission Regulation 36-14-6001. The Code of Ethics also provides that the petitioner may not accept outside employment that will impair his independence of judgment as to his official duties or responsibilities. See R.I. Gen. Laws § 36-14-5(b). Additionally, a public official may not use his office to obtain financial gain other than as provided by law. See R.I. Gen. Laws § 36-14-5(d). Also, a business associate is defined as an individual or business entity joined with an official to achieve a common financial objective. See R.I. Gen. Laws §§ 36-14-2(3) and 2(7).

The petitioner advises that the Planning Commission is considering a change to a zoning ordinance regarding marina parking. The proposed ordinance change will tighten offsite parking restrictions in that it will prohibit offsite marina parking in residential areas and allow offsite parking in marina and commercial districts only by special permits. The petitioner advises that he has various relationships with Conanicut Marine Services in that his son is employed by the company and that his company, Maguire Group Inc. does consulting work for the company, and the petitioner has testified as an expert witness in that company’s request for a special permit to expand their parking. The petitioner advises that the Town Solicitor represented to him that Conanicut Marine Services’ special permit for offsite parking, if granted by the Zoning Board, will be grandfathered in.

The Commission has previously concluded that an engineer and client relationship is one of a business associate relationship under the Code of Ethics. See A.O. 96-100 Additionally, we have concluded that where a public official is a principal of a company, that the company’s various business relationships are imputed to the individual public official. See A.O. 95-81 (opining that a Cranston Zoning Board member may not participate and/or vote on matters presented by other members of a law firm when the petitioner’s personal attorney is also a member of that firm). Finally, the Commission has concluded where a business relationship is of an ongoing nature or where business is reasonably anticipated in the future, that a business associate relationship exists. See A.O. 94-60 (concluding that a member of the North Kingstown Planning Commission should not participate in the consideration of a subdivisions proposal submitted by an engineer where the member planned to engage in business projects within the immediate future with that engineer) and A.O. 99-78 (advising a Narragansett Planning Board member that he may participate in the Board’s consideration of matters involving a personal acquaintance and/or a professional who previously represented him, provided a) no business relationship currently exists between the parties and b) it is not reasonably foreseeable that the parties will engage in a future business relationship). In this matter, the petitioner is a principal of an engineering company. One of that firm’s clients is Conanicut. The petitioner represents that the firm continues to provide consulting services to Conanicut. Given these prior advisory opinions and the ongoing nature of the petitioner’s/ petitioner’s firm’s relationship with Conanicut, the Commission concludes that the petitioner is a business associate of Conanicut.

The Commission has also concluded that where there is an ongoing business relationship, a public official must recuse from participation on matters that may financially impact that business associate. See A.O. 96-100 (concluding that a public official/engineer could not participate in matters concerning his client where there is an ongoing business relationship). Since Conanicut is the petitioner’s business associate by virtue of the petitioner serving as principal to an engineering firm that continues to do consulting assignments for Conanicut, he may not participate in matters where it will be directly impacted.

In various advisory opinions the Commission has concluded that a public official must recuse in ordinance matters that will impact his/her business associate. For instance, in Advisory Opinion 97-103, the Commission concluded that a Westerly Town Councilor may not participate in discussion, deliberations and voting on an ordinance regulating the Bed and Breakfast industry given the petitioner's close and dependent business relationship with a loan officer who has been vocal about the issue together with the financial impact that such an ordinance may have on the loan officer. See also A.O. 84-40 (concluding that a Newport City Councilor could not participate in changes to zoning ordinances given that the amendments would have either adverse or beneficial effects on the business of his clients); In re: Robert Ritacco, Complaint No. 97-40 (finding that a Westerly Town Councilor who participated in the consideration and the adoption of a Loading Zone Ordinance that benefited property owned and a business operated by members of his immediate family was in substantial conflict with his duties as a public official).

Additionally, the Commission has also recently issued advisory opinions relating to this matter. See A.O. 99-107 (advising a Jamestown Town Councilor that he may not participate in a discussion on whether the Town should take a position in a matter where it is an abutter given that he and/or his business associate has a financial interest in the particular project at issue); and A.O. 99-134 (concluding that a Jamestown Planning Board member may participate in the discussion and/or vote on a petition presented by his daughter since there is no indication that the petition would have a financial effect on his daughter or himself).

Here, the petitioner states that the marina’s special permit application will not be impacted by virtue of the petitioner’s actions on the ordinance since its application was already submitted. However, we note the Zoning Board has not yet decided whether or not to approve Conanicut’s special use permit for expanded parking. Therefore, it is entirely possible that the Zoning Board will disapprove Conanicut’s special use permit, thereby leaving the company without adequate offsite parking and directly impacted by the Planning Commission and Zoning Board’s action on the zoning ordinance proposal to further limit offsite parking. Even if the Zoning Board were to approve Conanicut’s permit for expanded offsite parking (which has been pending for some time), the zoning ordinance revision would limit its ability to further expand its offsite parking. Therefore, the potential for a benefit or detriment affecting the petitioner’s business associate, and thereby constituting a substantial interest under the law, is reasonably foreseeable. Given the business relationship with Conanicut and potential financial impact of the ordinance on the business, the petitioner may not participate in the zoning ordinance matter concerning offsite parking. We remind the petitioner to complete and file a recusal statement with the Planning Commission and with the Ethics Commission before any discussion on the ordinance takes place in accordance with R.I. Gen. Laws § 36-14-6.

Code Citations:

36-14-5(a)
36-14-5(b)
36-14-5(d)
36-14-7(a)

Related Cases:

In re: Robert Ritacco, Complaint No. 97-40

Related Advisory Opinions:

99-141
99-134
99-107
99-78
97-103
96-100
95-81
94-60
93-2
89-37
84-40

Keywords:

Business Associate
Regulatory Decisions